This study examines how literacy and numeracy skills affect the performance of Canadian high school dropouts in the labour market.
The authors note that their research shows these skills have significant effects on the probability of being employed and on the hours and weeks of work for both men and women. They also have a strong direct influence on the incomes of men, but not of women.
The findings suggest that high school curricula that develop literacy and numeracy skills could provide significant returns, even for those who don’t complete their education and wind up at the lower end of the labour market. The authors note that the findings also suggest that training programs catering to drop-outs could substantially improve their chances in the job market by developing these basic skills.
The authors note that their findings contradict a common economic theory that suggests there are minimal returns to human capital in the so-called secondary market, which is characterized by lack of training, low incomes and poor job security.